The proposed amendments to RA 9280 (The Customs Brokers Act of 2004) are still pending in Congress, hopefully to be deliberated and passed by the bicameral committee before the end of the term of the present congress. As written in a previous article, the proposed amendments do not seem to address many of the issues raised by various parties with regard to RA 9280.
In the meantime, many government agencies have been issuing conflicting rules in regards to the customs broker practice. For one, while the Securities and Exchange Commission (SEC) has long recognized and allowed the registration of general professional partnerships (GPP) of customs brokers, the Bureau of Customs (BOC) has yet to issue specific application forms for professional partnerships even if existing rules already allow the accreditation of GPPs. BOC has likewise prohibited corporate customs brokers from further transacting with customs.
Second, while PEZA has prohibited corporate customs brokers from further registering, it has yet to issue specific accreditation requirements for GPPs. In addition, PEZA procedures are not very clear as to who is allowed or qualified to process import and export entries at the economic zones and based on present practices, many PEZA registered companies, who are not registered as customs brokers, are actually being allowed to process import and export entries in the economic zones.
Customs Accreditation of GPPs. Part IX of CAO 3-2006A specifically provides that Customs brokers who have pooled their professional expertise, talents and resources to form a general professional partnership (GPP) pursuant to the provisions on PARTNERSHIP (Title IX of Book IV) of RA 386 (Civil Code of the Philippines) may, at any time, file an application for official recognition of its juridical personality with the BOC which shall be separate and distinct from the personality of each of the partners, who must be customs brokers as defined in this CAO.
The documentary requirements for accreditation are as follows:
- Duly accomplished application for recognition in three (3) typewritten copies;
- Payment of the nonrefundable amount of Php500.00 as processing fee and the amount of Php1,000.00 per partner as recognition fee;
- Articles of General Partnership with the corresponding Certificate of Registration;
- Taxpayer Identification Number (TIN);
- VA T Registration Certificate;
- SSS Certificate of Membership;
- Mayor’s Business Permit (current);
- Fidelity bond in the amount of One Hundred Thousand (Php100,000.00) pesos;
- Certified list of the firm’s bona fide customs representatives signed by the Managing Partner together with their corresponding NBI clearance (not more than three (3) months old) and SSS ID Card; and
- Privilege Tax Receipt.
Notwithstanding the fact that CAO 3-2006A expressly provides the basis and procedures for accreditation of GPPs, the BOC to date has not issued a single accreditation for a GPP.
Conflicting PEZA Rules. Present PEZA rules only allow individual customs brokers to be registered, to the exclusion of corporate customs brokers. However, the actual practice in the economic zones is that while corporate customs brokers are now disallowed to process import and export entries, any other entity duly registered with PEZA (e.g. transport companies and freight forwarders) is allowed to process such export and import entries. In other words, while corporate customs brokers have been prohibited from transacting in the economic zones, transport and forwarding companies have taken over many of the previous functions of the customs brokers, whether corporate and individual. In some of the economic zones, PEZA authorities are very strict in requiring that only registered employees of the customs brokers are allowed to process import and export entries even if the reality is that many, if not most, clearance transactions in the zones are now provided by transport and forwarding companies.
Corporate customs brokers have now lobbied congress to amend the RA 9280 and to allow corporate customs brokers to continue transacting with BOC and PEZA. The present practices at PEZA seem to have placed both corporate and individual customs brokers at a clear disadvantage.
Obviously, PEZA needs to provide clear guidelines on the registered activities of customs brokers, transport providers and freight forwarders. It also needs to issue specific registration requirements for GPPs. Failing that, contending groups will soon start raising compliance issues in regards to customs broker operations at the PEZA zone.
The author is an international trade, indirect tax (customs) and supply chain expert. He is the Editorial Board Chairman of Asia Customs & Trade, an online portal on customs and trade developments affecting global trade and customs compliance in Asia. He was also Bureau of Customs Deputy Commissioner for Assessment and Operations Coordinating Group (2013-2016). For questions, please email at agatonuvero@yahoo.com and agatonuvero@customstrade.asia
